Democrats in the Legislators are junking the idea of borrowing to bankroll the state’s 10-year, 500-million dollar Iowa Values economic development Fund. Senate Co-Leader Mike Gronstal, a Democrat from Council Bluffs, says Republicans refuse to go along with a borrowing plan.”Sometimes at the end of a session, strange things come together, but I don’t think that’s in the cards,” Gronstal says. The Iowa House voted last week to set aside 50-million in general state taxdollars every year for the next decade for the Iowa Values Fund. Senate Co-President Jeff Lamberti, a Republican from Ankeny, says under a borrowing scheme, the state’s taxpayers would pay 300 million in principle and interest to get 200 million to spend on the program. “It doesn’t take a banker to figure out how bad of a deal it would be for the people of Iowa,” Lamberti says. Gronstal, the Democrat leader, disputes Lamberti’s conclusion. Gronstal says businesses often borrow to finance operations. “At times it really does make sense to borrow the money,” Gronstal says. He admits interest rates were even lower a couple of years ago when the Iowa Values Fund was created to hand out high-dollar grants to new and expanding businesses. The fund was nullified this past summer by a Supreme Court ruling.
